If You Have To License The Software You Claim Infringes On Your Patent, How Is Your Patent Valid?

from the keep-'em-coming dept

It's certainly beginning to feel like we're hitting something of an inflection point in getting people to realize just how incredibly broken the patent system is. There has been a flurry of mostly excellent news stories from a variety of sources picking up on this and detailing specific cases of a broken patent system. The This American Life episode certainly helped kick off a lot of attention, but it's definitely been growing in other areas as well. The latest entrant into the field is an excellent article from Ben Popper over at The Observer's BetaBeat site, which focuses on one specific smaller patent troll, a company called IQ Biometrix, and what it's done over the years... which is basically nothing productive. However, it does have two hugely questionable patents: 7,289,647 for a "system and method for creating and displaying a composite facial image" and 6,731,302 for a "method and apparatus for creating facial images."

The company was created over a decade ago and made a single piece of software, which hasn't been updated since 1999. They still send it out on CD-ROMs, and talk about how maybe its patent trolling victories will allow it to offer a downloadable version. The CEO readily admits this:

"Our technology hasn’t really changed since the shrinkwrap copies we handed out in 1999. So the hope is to collect enough funds to launch a new version that will be available for download over the web, instead of as a mail order CD-ROM."

Of course, that new version actually involves technology from one of the companies it sued. While it didn't make the article, we've been told that part of the settlement that Oddcast made with IQ Biometrix over IQ Biometrix's patent lawsuit was to also license Oddcast's technology to IQ Biometrix so it could use it in its own product. Is there any greater indictment of the patent system than that? IQ Biometrix is claiming that it "invented" this technology, but it's been unable to actually build it. So, instead, it sues a successful company that did build it (not because of the patent, but independently) and then, as a part of the settlement, asks to be able to use the software of the company it sued!

Now I'm sure some defenders of the system will claim that this is somehow fair because IQ Biometrix invented it first and just couldn't raise the money to build it. But there are serious questions as to whether or not IQ Biometrix had any idea how to actually build anything it talked about. The article goes through the history of the company's two main patents, and you realize what a joke this is:

It doesn’t take a deep dive to understand the shaky ground for this patent. “That is an absolutely ridiculous claim. If this patent was filed today, it would almost certainly be rejected,” said Elliot Furman, a Manhattan-based patent prosecutor who has worked for firms like Gawker and BuzzFeed. Betabeat sent Mr. Furman a copy of the patent in question for evaluation. “It’s like they tried to patent a time machine, and they told you how big it was, and the color of the seats, but neglected to mention how it travels through time.”

The issue is a systemic one, says Mr. Furman, a former software engineer with a master’s degree from Stanford. “Many technical patents, and especially software patents, are just bad. The lawyers who wrote them don’t understand the history of computer science or the fundamentals of programming. They obscure that in legalese and it gets through the examination so the business thinks they have something great, like a patent on the entire avatar industry, when in fact what they have is a mess that probably wouldn’t hold up in court.”

At every instance the patent office bent over backward to allow IQ Biometrix to pursue its patent, despite numerous rejections on the grounds that the concept was obvious, that there was “prior art” and that the documents were technologically illiterate. After the first rejection in 2006, the IQ Biometrix legal team went back to the drawing board with new claims that referenced codes, values, screens, keyboards and processors, attempting to dignify the childishly simple act of reconstructing a face with an arsenal of technical gibberish. These claims were rejected outright a second time for being vague and indefinite.

Each time the patent was rejected, IQ’s lawyers went right back to work rephrasing the claims. “It’s a back and forth with the examiner,” explains Mr. Furman, “a feeling-out process to see what they can get approved.”

The whole story is a frustrating read of the patent system clearly being used to shakedown companies that actually innovated by a company that failed to do so. There are tons of quotes from tech industry people and investors about how patents just get in the way of innovation and are a major problem. Multiple people note that the system appears to work in the exact opposite way from its intended purpose.

As for IC Biometrix, the company sounds like a joke. It had a weak product that never did very well. The company apparently has revenue of less than $60,000 per year from its software, and despite filing the patents in the late 90s and getting nowhere with them, the process of constantly rewriting gibberish in the mid-2000s allowed it to claim broad, ridiculously worded patents. The company insists that it's not a patent troll, and says that it has to do this since venture capital is difficult to raise these days. Of course, Popper immediately points out that there's a massive amount of VC flooding into the market these days, more than any time in the last four years.

The company's execs also seem a bit delusional. Popper kindly passed along a hilarious part of his interview with the company's execs which didn't make it into the article:

"We are the farthest thing in the world from a patent troll. In fact, we have one of the top five technology companies in the world!"

According to who?

"Wikipedia! And I didn't even write that entry."

And while the company has been out trying to raise money based on plans to sue potentially up to 40 more companies over patents, its execs insist that they don't really plan to do that. They also position themselves as mere pawns used by the big law firm Kirkland & Ellis:

“Kirkland and Ellis came to us,” said Mr. Micek, naming the firm who represented them against Oddcast. According to Mr. Micek, Kirkland and Ellis offered to allow IQ Biometrix to retain ownership of their patents, but litigate on their behalf, with the two parties splitting the cut from any settlement. “I’m a bystander in this whole thing.”

I have no idea the details of this particular case, but we have heard similar stories from other small companies. The big law firms with aggressive IP practices effectively try to pull a Righthaven, but at least are smart enough to act as a law firm, rather than a partner company. But really, that's no excuse at all. Even if Kirkland & Ellis did approach IQ Biometrix in the first place, the company still went forward with the plan.

It's also amusing that the company now claims that rather than suing more companies, it's planning to sell itself. And... what exactly do you think any buyer is going to do? I'm sure the company is most attractive for one thing and one thing only: the patents over which any buyer can sue.

So once again, we have to ask why won't Congress actually do something about this? Everyone involved in the tech world is talking about these problems. Venture capitalists, developers, and execs alike are all complaining about a totally broken system that is irrefutably holding back innovation. And Congress twiddles its thumbs and passes bad legislation that only makes the problem worse.

Re: Typical

That would be nice. If you are gonna register something show the governmental department responsible for the patents a working piece of software and the code used. Also, the Government has to hire ppl capable of understanding the thing. A lawyer patenting a chemical process will probably believe you can make gold out of iron if you use convincing (but not real/practical) theories.

Oh and also, I'm not sure if it's the case but I think we have some sort of patent inception here....

Working prototype should be required for any patent.

A working prototype should be a requirement for any patent. A simple description of an idea is not enough. I would even go as far as requiring a viable business plan as well as a capitalization plan to be in the mix as well.

There should also be milestones required by patent holders to meet or else risk losing the patent and patent holders who do not meet them should be subject to challenges by other interested parties.

Filing a patent with no intent to produce anything should carry heavy penalties since patents deny other who came up with the same idea independently.

Re: Working prototype should be required for any patent.

Sometimes a single patent is not enough to capitalize over it but it helps protect a greater project. A prototype could be problematic for a person without enough money to produce.

I'd say you have to allow independent invention and allow groups to hold a patent (research groups). And also, make it so you can't enforce the patent for over, say, 2 years unless you present the said prototype or some more complete scheme.

I personally don't know what would be the best way out of this mess but I'm sure I'd get an idea if there was a public consultation. The senators might be clueless concerning how to fix the problem but there are plenty of specialists to support their decisions. Unfortunately money plays a major role in the decision process....

Re: Working prototype should be required for any patent.

You can't have a prototype for a method, which would mean you can't patent business methods!

And what incentive would any business have to improve it's business methods if they couldn't patent them? You think Henry Ford would have invented the assembly line if every other auto manufacturer could just copy it? So what if it meant he could manufacture a car 7 times faster than his competitors - that's hardly an advantage!

Unbelievable

I am consistently amazed at all these examples of blatant corruption and abuse of a system that is so clearly broken. Meanwhile, Congress spends all their time attacking each other over ridiculous political issues (which are equally amazing and disgusting), blaming their opponents, shirking responsibility, and generally ignoring the interests of their constituents.

This behavior should be criminal, and should come attached to jail time. I'm sick and tired of reading about this broken system and the damage it's doing to US interests. Reform is an absolute necessity but we're so far away from any real change that I almost (not quite) feel like even discussing it is a complete waste of time.

I socialize these stories everywhere I can but very few people I know show much interest in them. I don't think most people even care about or are aware of how much damage this system causes for US businesses.

I suppose I should have learned that my expectations of common sense and reasonable solutions to obvious problems are too much for the idiots known as Congresspeople and Senators in the USA. What a joke.

History will look back on our times and call us the most corrupt people ever documented in the history of mankind.

Re:

"“It’s like they tried to patent a time machine, and they told you how big it was, and the color of the seats, but neglected to mention how it travels through time.” "

Mike you may or may not realize this but this is actually just an argument that the patent itself did not enable the invention. However, in patent law we have this thing called the enablement requirement and it works in a funny fashion according to the courts. It holds that either the patent must enable the invention or one of ordinary skill must already be enabled to make and use it as of the time of filing. Now, the courts have turned the enablement requirement into somewhat of a low hurdle in most arts (especially software) because they have interpreted the enablement requirement to be nothing more than a requirement that one of ordinary skill would not require "undue experimentation" in order to make and use the invention. Of course, with software inventions it is usually fairly simple for someone to go out and write code to implement the invention, especially if they have some small amount of money to help out.

In essence this exempts software inventions from the enablement requirement as when it is applied by the PTO or the district courts against a software invention the appeals court always upholds the claims, usually (in the courts) when someone presents testimony that it would be easy to code for the invention.

Because of this I personally have advocated for an increased enablement requirement introduced into legislation to change the patent statutes. However, I am just one voice in the wilderness of the internet (even though I hang out where patent attorneys hang out at PO), it will take more than that to get the attention of congress.

Specifically I would like to see the enablement requirement strengthened to where one of ordinary skill would not have to perform much experimentation at all, not the other way around. This is what we should be demanding from our patent statutes as the times change to where the bare disclosure of a product/method/composition/apparatus in the abstract is not sufficient to warrant a grant of a patent. They need to give fairly detailed instructions on how to make the thing. Otherwise the patent disclosure is of very little value to the government and public that are granting the patent.

However, historically it has been asking a lot for them to disclose such, so it will be a hard sell.

Re:

bias

The only thing you and TAL have helped those knowledgeable in the patent system realize is how incredibly lacking in knowledge and biased you and they are.

“Patent troll”

Call it what you will...patent hoarder, patent troll, non-practicing entity, etc. It all means one thing: “we’re using your invention and we’re not going to pay”. This is just dissembling by large infringers to kill any inventor support system. It is purely about legalizing theft.

Prior to eBay v Mercexchange, small entities had a viable chance at commercializing their inventions. If the defendant was found guilty, an injunction was most always issued. Then the inventor small entity could enjoy the exclusive use of his invention in commercializing it. Unfortunately, injunctions are often no longer available to small entity inventors because of the Supreme Court decision so we have no fair chance to compete with much larger entities who are now free to use our inventions. Essentially, large infringers now have your gun and all the bullets. Worse yet, inability to commercialize means those same small entities will not be hiring new employees to roll out their products and services. And now some of those same parties who killed injunctions for small entities and thus blocked their chance at commercializing now complain that small entity inventors are not commercializing. They created the problem and now they want to blame small entities for it. What dissembling! If you don’t like this state of affairs (your unemployment is running out), tell your Congress member. Then maybe we can get some sense back in the patent system with injunctions fully enforceable on all infringers by all inventors, large and small.

Re: Re: bias

Re: bias

I love how you, and a few other government welfare urchins, always claim that Mike knows nothing about (insert egregious entitlement)... that's asinine, copy paste, spam. Are you just too drunk to type an actual reply @ 3:00-pm Riley? Seek Help and get a job that you don't have to wash off with Scotch.

What’s All This Patent Troll Stuff, Anyhow?

Ben Popper interviewed me for his article (and he worked hard to understand the patents). Many of you will be happy to know that there was a recent case whose outcome could spell trouble for trolls who files baseless lawsuits - http://bit.ly/pYsbjN

Mike cant you even get the title right !!!!

Mike you seem to think that simply saying alot of words gives you some authority, but what you say with those words is drek and purile, and most of the time has no bearing on reality. (as I have often pointed out).

But worst of all, the more you say, the more people know how you think (or not), and that what you say is not how you feel, but how you want others to think about you.

If that is the case, you have been quite successful, we know what you will say, and we know it will be the SAME OLD MIKE DREG we have come to know and hate.

I guess you dont mind 10,000 people thinking you're an idiot as long as you can convince 1 or 2 or your worshippers that what you say is the "word of mike" and is the same as coming directly from GOD...

The trouble is nothing ever comes from your own mind !!! nothing is original, or you seem to do is search the web and copy/paste others works, tack on a smart ass comment at the end and say "job done!!!, where is my google kickback".

do you actually have ANY idea's of your own, or do you have to entirely rely on the idea's of others for your fodder ?

It appears you are incapable of performing original research and instead take information second or third hand with any fact checking. without boing boing, techrights, and google and a few other of your cronies you would have nothing.

Re: Mike cant you even get the title right !!!!

friends with benefits

Why won't Congress do something about this? Well, most likely because of some of our legislators' connections to certain special interests -- i.e., "patent trolls." However, objectively speaking, the behavior of NPEs amounts only to asset acquisition and profit enhancement. Unless they are deemed to be engaging in per se illegal acts or unfair business practices, I can't imagine Congress taking any serious action against NPEs.